France's Macron Faces Tough Challenges at Home and in Europe

PARIS (AP) — French President Emmanuel Macron is facing a mountain of challenges in the new year — starting with yellow vest protesters who are back in the streets to show their anger against high taxes and his pro-business policies that they see as favoring the wealthy rather than the working class.

Once Europe's rising star, Macron is now fighting to save his image and his vision for transforming France's welfare state and economic model. Here's a look at three major issues he will need to tackle in 2019:

YELLOW VEST CRISIS

Since November, demonstrations initially triggered by a tax hike on diesel fuel and expanded to encompass the high cost of living have led to violent clashes with police in Paris and other cities — including most recently on Saturday.

Macron made multiple concessions that failed to extinguish the anger of the yellow vest movement, named after the fluorescent protective garments the protesters wear. He abandoned the tax hike and announced last month a series of measures to boost purchasing power. The package, estimated at 10 billion euros ($11.5 billion), includes a 100-euro ($114) monthly increase to the minimum salary.

The big challenge now is containing the protest violence that's hitting Paris tourist quarters. In his New Year's speech, Macron adopted a tougher stance against any violence, denouncing "heinous crowds" and urging a restoration of order.

Hoping to calm tensions, the government called on the French to express their views during a "national debate" organized in the coming weeks in all regions.

REFORMS AHEAD

Despite the protests, Macron has vowed to keep reforming the country this year to fulfill some of his electoral promises. Planned changes concern highly inflammatory topics: an overhaul of the indebted pension system and of France's relatively generous unemployment benefits.

The government wants to apply the same rules to all new pensioners in order to replace the dozens of different systems specific to certain jobs. Macron promised the legal retirement age will remain at 62 but the changes might reduce some other advantages.

The government also plans to apply stricter rules to obtain unemployment benefits. Other measures would allow job cuts among civil servants.

The government appears politically weakened by the yellow vest movement but can still pass new bills at parliament, where Macron's centrist party holds a strong majority. Macron and his parliamentary majority don't face new elections until 2022.

EUROPEAN ELECTIONS

European Parliament elections in May could turn in France into a vote for or against Macron's policies.

Opinion polls last month saw Macron's popularity at its lowest level, with support from just about a quarter of respondents. Meanwhile, Marine Le Pen's far-right, anti-immigration party National Rally is expected come out on top in the European elections.

Some yellow vest protesters are consider launching their own bid, which potentially could shuffle the cards.

Elected on a pro-European platform, Macron is advocating for common rules that he promises will protect European workers, and wants to strengthen EU unity.

He had ambitions to create a new centrist alliance of European lawmakers, but the yellow vest crisis cast doubts on his capacity to do so.

It notably damaged his European credibility by pushing France over the EU deficit limit. That's bad news both for the European economy and for the man who won the French presidency in 2017 on promises to revive the dream of European unity.

French President Emmanuel Macron is facing a mountain of challenges in the new year - starting with yellow vest protesters who are back in the streets to show their anger against high taxes and his pro-business policies that they see as favoring the wealthy rather than the...